After being released by the Bears, former defensive end Julius Peppers signed with the Green Bay Packers. He did so quite happily too, as BWD Radio Promotions provides a photo of peppers at Lambeau Field—cover your eyes, Bears fans:

It wasn't all bad news for the Bears since the last update. Charles "Peanut" Tillman, one of the most well-known figures in the Chicago Bears organization over the last 11 seasons, has been re-signed for one more year with the only team.

Sean Jensen of Thrive Sports reported the signing:

Charles Tillman has re-signed with the #Bears on a one-year deal, I'm told. Somewhat of a surprise but pleasant one, given his legacy there

The defensive back went through struggles in 2013 as injuries hampered his play on the field, but he's still been a staple of the team's defense for more than a decade. That alone was enough to convince David Haugh of the Chicago Tribune that the move was a smart one for everyone involved:

... Both sides realized how much they needed each other. The Bears defense gains the credibility that comes with keeping the franchise's best cornerback ever and the 33-year-old Tillman gets reasonably compensated to prove he still can play at a high level despite his age and iffy health. No other offseason signing will go as far as Tillman's in starting to make the Bears defense whole again.

Losing Tillman would have been a Peanut Punch to the gut. The more Tillman stays on the field, the closer the defense gets to respectability. He never has been cast in the traditional mold of a cover corner such as higher-paid players like Darrelle Revis or Aqib Talib but the way Tillman tackles and forces fumbles makes him unique.

Updates from Thursday, Mar. 13

The Bears signed wideout Domenik Hixon according to their official Twitter feed:

LM: #Bears have agreed to terms on 1-year contract with WR Domenik Hixon.

The Chicago Bears enter 2014 free agency in a precarious cap situation with plenty of holes to address on the roster.

While the Bears can back-load contracts in anticipation of cap raises down the road and ask costly veterans such as receiver Earl Bennett and defensive end Julius Peppers to take pay cuts or restructure, head coach Marc Trestman's team does not figure to be a major player on the market.

Right?

One thing is for sure—the Bears have to improve on their subpar 8-8 mark from a year ago. In order to do so, the front office must walk a financial tightrope to add talent.

Below is a comprehensive look at Chicago's situation and a list of moves the team has made in free agency.

Salary-Cap Situation

Nam Y. Huh/Associated Press

According to Over the Cap, the Bears have slightly more than $8 million in cap space to play with this offseason, with Jay Cutler and his new deal accounting for more than $22 million against the cap, and Peppers accounting for just over $18 million.

It is quite the scary forecast when one takes into consideration the team also has to set money aside for draft selections and injury insurance should players go on injured reserve next year.

In the infancy of free agency, the Bears have done little to find more wiggle room, although Jeff Dickerson of ESPN hints that a pay cut may be in the cards for Bennett:

#Bears have not asked WR Earl Bennett to take pay cut. '14 cap number is $2.450 million. This is always subject to change. #nflfreeagency.

Chief among the important names set to hit the market is defensive tackle Henry Melton, the team's franchise player a year ago. Melton is the top tackle available and one of the league's best 3-technique rushers, so the Bears may have issues bringing him back—that is if they want him, considering he tore his ACL in October.

Backup quarterback Josh McCown is another name to watch, as his ability to come in and execute Trestman's offense last year with Cutler hurt kept the team relevant and actually created a spark.

Corner Charles Tillman has a storied 11-year history with the franchise, but only played in eight games last season and is 33 years old.

Depth pieces like Corey Wootton and Major Wright are other names to watch, as experienced replacements in Chicago's system may not be so easy to come by.

Team Needs

Matt Rourke/Associated Press

While it sounds like an exaggeration, the Bears need help at all levels of the defense.

Peppers appeared a shell of his former self last season and rookie Shea McClellin was a colossal dud to the point the team is moving him to linebacker this offseason. Speaking of linebackers, the play a year ago was horrendous enough that each position is likely going to get a makeover, with the exception of Lance Briggs' spot.

In the secondary, both safety spots are due for an upgrade, and an infusion of talent at corner would not hurt, either.

The offensive side of things is the least of Chicago's concerns at the moment, but depth in the trenches would be nice. Thanks to Trestman's offense that routinely gets the absolute most out of its talents, that side of the ball is far from what the focus is on in the Windy City this offseason.

Latest Rumors

Josh McCown No Lock to Return

Nam Y. Huh/Associated Press

The Bears would ideally like to have McCown back in the fold, but he may have other plans once he hits the market. According to Dickerson, McCown has a starting gig in mind:

McCown: 'If I leave Chicago, that's the opportunity (to be a starter) that I'm looking for."

ESPN's Adam Schefter recently stated on the Ross Tucker Podcast that "I don't expect him to be back in Chicago, because the interest will be that great in his services," (h/t Rotoworld). Further adding fuel to the fire that McCown is as good as gone is NFL Network's Ian Rapoport, who lists Tampa Bay as a team high on his services:

Talked backup QBs on Total Access: #Bucs are in the market for a backup. They’ll be looking at #Bears QB Josh McCown & #Lions QB Shaun Hill

The brother of tight end Martellus Bennett, defensive end Michael Bennett is on the market once again and a top name for teams in need of a quality rusher. As Brad Biggs of the Chicago Tribune points out, all indications are that Bennett is the team's top priority:

Should it not work out, the Bears have also reportedly thrown their hat in the ring for Cincinnati's Michael Johnson, according to Dickerson. Johnson had a down year in terms of sack numbers in 2013, but still ranked as the No. 4 overall 4-3 defensive end in the NFL, according to Pro Football Focus (subscription required).

Ian Rapoport of NFL.com provides another name the Bears will be interested in pursuing:

Source: #Bears are now targeting #Raiders star defensive end Lamarr Houston after missing out on Michael Bennett. They are pushing hard

Whiter is a massive upgrade against the run if the Bears are able to pull it off, but it appears his market is just beginning to heat up. He ranked as the No. 6 overall safety in the NFL last year, according to Pro Football Focus (subscription required), so his services may also be out of Chicago's price range.

Roster Additions

Player

Position

Contract

Lamarr Houston

DE

5 years, $35 million

Trevor Scott

DE

1 year, $730,000

Ryan Mundy

S

2 years

Austen Lane

DE

1 year

Jordan Senn

LB

1 year

D.J. Williams

LB

1 year

-

Trevor Scott

Al Messerschmidt/Getty Images

The first notable move of free agency by the Bears came in the form of grabbing some depth on the defensive line.

According to Dan Wiederer of the Chicago Tribune, the Bears signed Trevor Scott to a one-year deal. A sixth-round pick in 2008, Scott has made 18 career starts and was most recently seen in Tampa Bay as a backup last season before being cut in October.

As far as depth and cost effectiveness go, Chicago could have done much worse.

Not long after landing depth on their defensive line, the Bears mad their first big splash of the offseason. According to ESPN's Adam Schefter, the Bears and defensive end Lamarr Houston agreed to a five-year, $35 million contract. Houston will replace the departed Julius Peppers, who was cut by the team on Tuesday as a cap-saving move.

It will be interesting to see how this move is received. Peppers is one of the most decorated pass-rushers in league history. And though he's well into the decline phase of his career, he still managed more sacks (7.5) than Houston (six) last season.

Still, there's a reason anyone who watches film regularly loves Houston. Coupled with the cap savings overall on this deal, this should help a defensive overhaul in Chicago.

Grade: B

Ryan Mundy (S)

After enjoying the best season of his career with the New York Giants, safety Ryan Mundy cashed in on Tuesday as the former sixth-round pick inked a two-year deal with the Bears, according to Brad Briggs of the Chicago Tribune:

Took a little more than 90 minutes and #Bears have announced deals for DE Lamarr Houston, S Ryan Mundy, LBs DJ Williams & Jordan Senn

While Mundy isn't a star by any means, he could prove to be a smart signing on Chicago's part. Mundy saw the most extensive action of his career last season with 10 starts, and he acquitted himself well to the tune of 77 tackles, one interception and one sack.

Mundy shouldn't be classified as a ball hawk or a big-play guy in the secondary, but he does the little things and adds great depth. According to Adam Jahns of the Chicago Sun-Times, Mundy isn't a guy who is going to be a huge difference maker.

Ryan Mundy isn't exactly the answer at the safety for the #Bears. His starting experience is limited. He does have special teams experience.

Mundy is a versatile player, though, and he is the type of guy that every successful team needs. Assuming his cap number is reasonable when it is officially released, it's difficult to find many issues with this signing.

Grade: B-

D.J. Williams (LB)

After nine seasons with the Denver Broncos, D.J. Williams made the move to the Windy City last season. Things started out well as he put up 27 tackles and two sacks in six games as the de facto replacement for Brian Urlacher, but a torn pectoral muscle cut his season short.

The Bears are banking on Williams returning to form and picking up where he left off, and they signed him to a one-year deal, according to Jeff Dickerson of ESPN.com:

Since the term is so short, there is very little risk on Chicago's part. The 31-year-old veteran has had some extremely productive seasons over the years, including five straight campaigns with 90 or more tackles while with the Broncos.

Per Zach Zaidman of ESPN 2 Chicago, Williams was a key player for the Bears before injury struck in 2013:

D.J Williams has played just 13 games over past 2 years, but #Bears sorely missed his presence in the middle after he went down in 2013.